Progress on buildings circularity depends on 4 key elements

A growing global population and the enormous amount of material tied up in the built environment makes it one of the most important sectors to transition to circularity. Here are the numbers:

• 30-40 percent of all solid waste generated globally comes from the construction and demolition of buildings.
• Approximately 11 percent of global carbon emissions is generated from the cradle-to-gate emissions (a.k.a. embodied carbon) of building materials.
• Global building floor area is expected to double by 2060, the equivalent of adding all of the buildings in New York City every month for the next four decades.

The building sector is difficult to transition to circularity due to the complexity of materials in any given building, long lifetimes of products and the buildings themselves, and the challenges with transforming incumbent construction and demolition practices across the globe. The current system of codes, policies and established practices often disincentivizes practices such as adaptive reuse, deconstruction, reuse of materials and recycling. 

A new report from the Center for the Circular Economy (funded by 3M) is a guide to key interventions that can lead to a more circular future for the built environment. The report asks the core question: “How can this sector identify a path forward that incorporates circularity while still meeting all the mandates of building functionality, safety and profitability?”

Innovation

Most building products are not designed for circularity and the most common construction practices are not set up to take advantage of them even if they were. Take a relatively straightforward product such as gypsum board. Its core material can be recycled or reused in multiple applications, but the Gypsum Association doesn’t even mention new gypsum board as one of those applications in its initial list of second uses for gypsum boards. 

This is one of many indicators that implementing circularity in the built environment will require significant innovation on product and building design, deconstruction and recovery, and recycling infrastructure.  

Policy 

Another big challenge lies in dislodging the incumbent state of linear buildings. We’ve been constructing buildings in largely the same way for a century or more, so what is going to trigger a change? 

As with many fields, policy shifts at all levels of government will be necessary to spur necessary innovation, including: 

• Financial incentives such as those contained in the Bipartisan Infrastructure Law and the Inflation Reduction Act.
• Aligning government purchasing with the transition to circularity through initiatives such as the Federal Buy Clean Initiative, the Federal-State Buy Clean Partnership and various state programs such as the New York State Buy Clean Concrete Guidelines. 
• City and state level ordinances around deconstruction (as opposed to demolition), scrap and waste recovery, and adaptive reuse.

Once circularity is the standard method for dealing with building products and whole buildings, it is likely to be self-supporting. Policy intervention now, though, can act as a catalyst for the change just as it has for renewable energy and electric vehicle adoption. 

Partnerships 

The report describes the ecosystem surrounding the built environment: 

“The fragmented built environment value chain encompasses a wide diversity of stakeholders, including developers, architects, engineers, contractors, trade workers, building owners, investors and occupants, among others. Aligning the distinct priorities of this vast ecosystem of participants can be challenging and time-consuming.”

A few key partnership types can move the building industry toward circularity, including: 

• Public-private partnerships that integrate the regulatory capacity of government with the innovation engine of private industry.
• Cross-sectoral partnerships that span academia, industry, governments, NGOs and community organizations to include an array of diverse perspectives and priorities.
• Community-led initiatives that take advantage of the local insights in order to align circular initiatives with residents’ needs in any given area.

Breaking down silos within the building ecosystem is the first step. Incentives for product manufacturers, architects and designers, developers and building owners and operators are often misaligned and the important work of sustainability and circularity is regularly value-engineered out of projects. 

Financing

Just two pages of the 65 page report are dedicated to financing the transition to a circular built environment. The report touches on buyout investments, venture capital and growth equity, real estate investors and project finance. 

An entire report could be written on the financing of this transition. Innovators of more circular building products and established companies redesigning products for circularity both need investment to scale and make necessary changes to their processes. Building owners need financing to make the upfront investment in circularity. Companies focused on the secondary materials market will require infrastructure investments. The circular buildings ecosystem is likely to support itself financially once scaled, but the initial investments are likely to be quite large. 

The new report provides a solid template for future work. The report concludes, and I agree, that strategies and tools already exist to transition toward circularity in the built environment. The challenge will be to capitalize on these strategies and break the grip of incumbent practices quickly and efficiently.

[Learn how companies are navigating the fast changing sustainability agenda and driving more impact with Trellis Network.]